Final Exam Flashcards
What is one product, multiple markets?
one product that hits various different demographics (i.e: harry potter books, frosted flakes cereal)
What is cannibalization?
company offers a new product and it only gets bought by your current buyers and doesn’t bring in new customers
What is multiple products, multiple market segments?
ford pickup trucks and ford suv’s, gap’s banana republic, gap, and old navy brands
What is segments of one, mass customization?
taking a product and making it exactly what you need (nike customization shoes, invisalign)
What are segmentation variables?
characteristics of individuals, groups, or organizations used to divide a market into segments
What are demographic variables?
genders, teenagers v. senior citizens, income levels
What are geographic variables?
east coast v. west coast, urban v. rural, climate
What are psychographic variables?
values, lifestyle, individual differences
What are behavioral variables?
usage pattern, benefits sought, decision making process
What is the target market process?
segmentation, targeting, positioning
What is positioning?
the act of designing the company’s offer and image so that it occupies a distinct and valued place in the target customer’s minds
Why is positioning important?
What is head to head strategy?
competing directly with competitors on similar product attributes in the same target market
What are points of parity?
attributes that inform the consumer that you are capable of providing something that might work
What are points of difference?
what makes your brand unique in a way that matters to the consumers
What is differentiation strategy?
strong, favorable, distinctive, and compelling associations that distinguish a brand from the crowd are fundamental to brand success
What is positioning statement?
describes the product and the market in which they compete
What is a product?
good, service, or idea that satisfies needs
What is customer value proposition?
cluster of benefits that an organization promises customers to satisfy their needs
What are the 3 i’s of characteristics of services?
intangibility, inconsistency, inventory
What are convenience products?
products you can find in many locations that you can buy quick and often
What are shopping products?
products that are available in fewer locations which we give more thought and bought less frequently
What are specialty products?
you have to hunt for where to buy these products
What are unsought products?
products you need but dont realize you need like life insurance
What is a product item?
a specific product with a unique brand, size or price
What is a product line?
a group of products or services that satisfy a class of needs
What is a product mix?
consists of all product lines offered by an organization
What are the three levels of innovation?
continuous, dynamically continuous, discontinous
What is continuous innovation?
requires no new learning by consumers
What is an example of continuous innovation?
new improved shaver
What is dynamically continuous innovation?
disrupts consumer’s normal routine but does not require totally new learning
What is an example of dynamically continuous innovation?
electric toothbrushes
What is discontinuous innovation?
requires new learning and consumption patterns by consumers
What is an example of discontinuous innovation?
electric car
What is the product life cycle?
introduction, growth, maturity, decline
What is the growth stage of the PLC?
the product is accepted and sales rapidly increase
What is the maturity stage of the PLC?
sales peak, profit margins narrow
What is the decline stage of the PLC?
sales decrease as customer needs change
What are the types of product adopters?
innovators, early adopters, early majority, late majority, and laggards
What is an innovator?
higher educated, use multiple information sources
What is an early adopter?
leaders in social setting; slightly above average education
What is early majority?
deliberate; many informal social contacts
What is late majority?
skeptical; below average social status
What are laggards?
fear of debt; neighbors and friends are information sources
What is relative advantage?
degree to which consumers perceive the new product as offering superior benefits
What is compatibility?
consistent with existing cultural values, customs, practices, ‘way of doing things’
What is trailability?
ease of sampling a new product and its benefits
What is observability?
degree to which others can witness the new product and benefits
What is brand?
the emotional connection people have with your business or product, and their perception is reality
What are the elements of brand equity?
brand name awareness, perceived brand quality, brand associations, and brand loyalty
What is brand equity?
the added value a brand name gives to a product beyond the functional benefits provided
What is individual branding?
separate brands for each product or product line
What is another name for individual branding?
multibranding
What is an example of multibranding?
chevrolet, buick, and cadillac are all brands of GM
What is umbrella branding?
a single brand for nearly all of a company’s products
What are other names for umbrella branding?
family branding or multiproduct branding
What is an example of umbrella branding?
kirkland signature
What is product repositioning?
change essential aspect of a product, often to increase relevance
What are brand extensions?
strategy of using established brand in different context
What is an example of a brand extension?
dyson vacuum to dyson fans and hairdryers
What is the only marketing mix variable that can be changed quickly?
price
How do you calculate profit?
profit = total revenue - total cost
How do you calculate profit when you don’t have total revenue?
profit = (price x quantity sold) - total costs
What is price?
the assignment of value, or the amount the consumer must exchange to receive the offering
What is the relationship between price and demand?
there is an inverse relationship
What is inelastic demand?
a change in price results in a little or no change in quantity demanded
What is elastic demand?
a change in price causes a great (opposite) change in quantity demanded
What are fixed costs?
don’t change with the number of units produced
What happens with average fixed cost per unit?
it will always decrease as the number of units produced increases
What is variable costs?
those production costs that are tied to the number of units produced and thus vary depending on volume
What are examples of variable costs?
raw materials, credit card fees, sales comissions
What are examples of fixed costs?
rent, mortgage payment, insurance
What is break-even point?
the point at which the costs of producing a product equal the revenue made from selling the product
What is contribution margin?
difference between total revenue and total variable costs
How do you calculate contribution unit margin?
price - variable costs
What is cost based pricing?
calculate price based on company’s costs
What is competitive based pricing?
benchmarking on competitor’s prices
What is demand based pricing?
setting a price based on what consumers are willing to pay
What is an example of demand based pricing?
ubers, lyfts, hotels
What happens in the last stage of the product life cycle?
competitors start to leave the market
What are the 4 P’s?
product, price, place, promotion
What are the 4 C’s?
customer solution, customer cost, convenience, communication
How do we calculate value?
value = customer benefits - customer costs
What are three things we must do before differentiating?
signal to consumer the goal they can expect to achieve by using your brand, leveraging your points of parity, and making your points of difference compelling
What are points of parity?
consumers must perceive your product to be a legitimate and credible player in the frame
What is an example of a direct channel?
etsy
What is a channel structure?
flow of goods and services from manufacturer to target customer
What is a direct channel?
from company to customer; manufacturer and end customer interact directly with no intermediaries
What is an indirect channel?
company retailer customer or company wholesaler retailer customer
What are hybrid channels?
a company that has a storefront but also. sells through different retailers like apple
What is an advantage of a direct channel?
greater control over environment in which offering is delivered
What is a disadvantage of a direct channel?
takes time to establish and difficult to establish same breadth
What are some advantage of indirect channels?
rapid distribution and breadth
What are some disadvantages of indirect channels?
loss of control over selling environment and brand associations
What is a product’s value-chain?
efficiently getting the product, in good condition to where, it is convenient for the consumer to buy it, and in a setting that is consistent with the brand’s image
What is full vertical integration?
a firm takes over control from production to customer facing portion
What is forward vertical integration?
manufacturers gain ownership over the intermediary at the next level down
What is backward vertical integration?
retailers might own the manufacturing operation ex: mcdonalds buying farms
What is intensive distribution?
placing products in many outlets; convenience products
What is exclusive distribution?
placing the product in very few outlets; shopping products
What is selective distribution?
somewhere between the other two; specialty products
What are slotting allowances?
fees that are paid by the manufacturer to the retailer to get space in store
What is the marketing mix?
product, price, promotion, placement
What are brick and mortar stores?
a physical place
What is self service?
customers perform many of the functions during the purchase process
What is limited service?
customers responsible for most shopping activities but salespeople are available for help in some departments
What is full service?
specialty stores and department stores; wanting to make the customer’s life as easy as possible
What are atmospherics?
project a functional and psychological picture that appeals to the target market
What needs to happen in the maturity stage?
maintain loyalty
What is a promotional activity to inform?
advertising, publicity, free samples
What is coherence?
a consistent and compelling message can help significantly in creating a consistent and compelling position for the brand
What is a promotional activity to persuade?
personal selling to intermediares
What do you do when you find something that works?
stick with it
What is the promotional mix?
advertising, selling, direct marketing, sales promotions, public relations
What is push strategy?
manufacturer incentivizes retailer who incentivizes customers to buy
What is pull strategy?
manufacturer are mainly directed to consumers who will then try to get their retailers to carry it
What is pioneering advertising?
used during introductory stage of PLC(informational)
What is competitive advertising?
promotes a specific brand’s features and benefits
What is comparative advertising?
a subset of competitive, shows one brand’s strengths relative to those of the competition(need data to support)
What is reminder advertising?
emphasize previous knowledge of the product
What is reinforcement advertising?
a subset of reminder; assure current users they made the right choice
What is advocacy advertising?
state the position of a company on an issue
What is SMART?
specific, measurable, achievable, relevant, timeline
Why are strategy and execution equally important?
a great strategy with poor execution will fail, as will a greater execution of a poor strategy
What is personal selling?
direct interaction between a company representative and a customer, two-way flow of information
What are advantages of personal selling?
immediate feedback, quite persuasive
What are disadvantages of personal selling?
expensive per exposure, messages may differ
What is B2C?
business to consumer
What are inside sales?
from a desk, personalized
What are some examples of personal sellers?
barbers, dentists, attorneys, realtors
What are outside sales?
sales reps visiting locations, personalized, selling products into retail stores
What are order takers?
sales person who collects orders but does not attempt to find new customers or persuade existing customers to increase the size or frequency of their orders
What are order getters?
sales person who increases the firm’s sales revenue by acquiring orders from new and existing customers
What is presentation?
begin converting a prospect into a customer by creating a desire for the good or service
What is close?
obtain a purchase commitment from the prospect and create a customer
What is a stimulus-response presentation?
given the appropriate stimulus, the customer will buy
What is another word for stimulus-response presentation?
suggestive selling
What is formula-selling presentation?
information must be provided in step-by-step, thorough, accurate manner
What is need-satisfaction presentation?
probing and listening, identifying needs/interests
What does it mean to acknowledge and convert?
acknowledge and turn to a positive - “yes, and this is why…”
What does it mean to postpone?
don’t answer immediately but remember to get back
What does it mean to agree and neutralize?
explain why it isnt a problem
What does it mean to accept the objection?
learn from them - “thanks for pointing that out to me”
What is denial?
to prevent misinformation
What does it mean to ignore the objection?
meant as a stalling technique
What is crowdsourcing?
generating insights leading to actions based on ideas from massive numbers of people
What is an example of crowd sourcing?
create the next oreo flavor!
What is crowdfunding?
gathering an online community of supporters to financially ally around a specific project unlikely to get resources from traditional funding
What is user-generated content?
created by consumers instead of the brand
Who do consumers tend to trust?
their friends over corporations
What is social marketing?
a process that uses marketing principles and techniques to influence a target audience behaviors that will benefit society in addition to the individual
What is an example of social marketing?
australian train company - “dumb ways to die”
What is social marketing used for?
enhancing financial wellbeing, protecting the environment, improving public health, etc.
What are the behaviors that social marketing are working against?
“fun” behavior
